Lisbon, Oct. 29, 2024 (Lusa) - Portugal's Santander Totta bank saw profits of €778.1 million up to September, 25% more than in the first nine months of 2023, the bank said on Tuesday in a statement.
Contributing to profits was, above all, net interest income (the difference between interest charged on loans and interest paid on deposits), which rose 20% to €1.244 billion.
According to the bank, net interest income is still benefiting from the rise in interest rates, but "at a progressively slower pace" after the European Central Bank (ECB) began its rate cut cycle.
Commissions remained stable at €345 million. According to Santander Totta, this is the result of an increase in credit, investment fund and insurance commissions, while, on the other hand, fewer commissions were charged for financial advice.
As for expenses, up to September, operating costs totalled €389.9 million, a slight increase on the same period last year (0.6%). Staff costs (which are included in operating costs) rose by 2.5% to €215.2 million.
Net provisions and other results had a cost of €38.5 million due to the extraordinary contribution on the banking sector and the solidarity surcharge.
Looking at the bank's balance sheet, mortgage lending grew by 3.9% to €23 billion at the end of September, which, says the bank, is the result of its "very competitive commercial offer in the segment, in terms of mixed rate".
Regarding early loan repayments, Santander Totta says that the gradual reduction in interest rates "minimised early loan repayment activity", but does not indicate figures.
Consumer loans grew 7.8% to €1.899 billion and corporate and institutional loans grew 9.8% to €22.757 billion up to September.
In September, the ratio of problem loans (NPE - Non-Performing Exposure) was 1.7%, unchanged from the same period last year. According to Santander, the quality of loans "continues to benefit from the favourable macroeconomic context", particularly high employment.
Deposits increased by 4.2% year-on-year to €36.970 billion in September.
Finally, in terms of solidity indicators, Santander Totta's CET1 ratio was 16.7% in September (16.3% in September 2023).
Santander Totta is owned by the Spanish banking group Santander, which today reported profits of €9.309 billion in the first nine months of the year, 14% more than in the same period in 2023.
In 2023, Santander Totta had its highest ever profits of €1.030 billion.
In February, when he presented the 2023 accounts, the chairman of Santander Totta devoted a large part of his speech to taxes, saying that the bank he leads "must be the private company that pays the most IRC [profit tax] in Portugal’, with €431 million paid in 2023, and said that more charges on banking mean "less credit with which to help the economy".
The proposed state budget for 2025 maintains the contribution on the banking sector (estimated to raise €210 million) and the additional solidarity tax (an extra €40.8 million). It also includes a drop in the corporate income tax (IRC) rate from the current 21% to 20%, which has an impact, above all, on large companies such as banks.
Santander Totta released its results today only in a press release, without holding a press conference.
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